Pound Australian dollar (GBP/AUD) exchange rate muted following Australian data
The pound Australian dollar (GBP/AUD) exchange rate is trapped in a narrow range this morning, despite the release of some disappointing Australian trade data.
At the time of writing the GBP/AUD exchange rate is trading at $1.9189, virtually unchanged from this morning’s opening rate.
Australian dollar (AUD) stable despite downbeat trade data
The Australian dollar (AUD) is holding steady this morning despite an unexpected downturn in Australia’s latest trade data.
February’s figure came in at AU$7.28 billion, substantially below forecasts of a trade surplus of AU$10.5 billion, and shrank from January’s reading of A$11.03 billion.
Australian exports fell by 2.2% month-on-month in February, contrasting with theprevious1.6% increase in January. Elsewhere, domestic imports rose by 4.8%, jumping from a previous reading of 1.3%.
The disappointing reading was primarily put down to a drop in exports in Australia’s key commodities such as iron ore and minerals and marked a 5-month low, putting pressure on the ‘Aussie’.
Further undermining AUD exchange rates this morning is a spell of cautious trade. Ahead of the latest US non-farm payrolls figures, markets are reluctant to place bets on riskier assets, ultimately denting the Australian dollar.
Pound (GBP) rangebound amid absence of data
The pound (GBP) is trading sideways against the majority of its peers this morning as a lack of UK data have left Sterling struggling to find a clear direction.
Amid a lull in domestic data, GBP investor attention turns to ongoing Bank of England (BoE) interest rate cut speculation.
Off the back of yesterday’s faster-than-expected slowdown in service sector activity, investors have continued to price in a potential interest rate cut as early as June this year.
These ramped up rate cut bets have served to undermine GBP exchange rates this morning.
GBP/AUD exchange rate forecast: Australian data to infuse volatility into the Australian dollar?
Looking ahead, the primary driver of movement for the pound Australian dollar exchange rate in the first half of next week is likely to be a number of Australian economic data releases.
On Tuesday, Australia’s Westpac latest consumer confidence index is scheduled for release.
Should the data show that consumer confidence improved in April, this may underpin AUD exchange rates at the beginning of next week.
However, any upside in the ‘Aussie’ may prove limited as the subsequent release of the NAB business confidence index is expected to report morale in the private sector deteriorated in March.
Turning to the Pound, a continued lack of UK data for a large part of next week may leave the pound vulnerable to shifts in market mood, and could see GBP exchange rates slip if markets move into cautious trading conditions.